Cole Hamels’ Future Value

This year’s Hot Stove was insane. The Dodgers and Red Sox were very active, as were my Blue Jays (we have seen that before). Even surprise teams like the Padres and White Sox made notable acquisitions, some that rewrote their 2015 objectives. The Phillies traded their franchise hits leader Jimmy Rollins to the Dodgers. They traded their best source of power, Marlon Byrd, to the Reds. Nobody is giving more than a laundry machine for Ryan Howard, so Ruben Amaro Jr. is currently eating that huge contract. However, Cole Hamels is still on the Phillies’ roster.

Before the regular season had concluded, there were many trade talks surrounding the lefty ace. Through the winter meetings, there were more. Currently, the Padres are a team in discussion with the Phillies for Hamels’ services. The Red Sox have also been linked. For some unknown reason, the lowly Astros too have been mentioned as a sleeper destination. While a rebuilding team like the Phillies should undoubtedly be shopping a pitcher who probably won’t be of as much help when they return to competitiveness, no trade has been finalized. In a Bob Nightengale piece mid-summer, he sourced a Dodger official saying the asking price was Joc Pederson, Corey Seager and Julio Urias. You do not need to be a prospect guru to know those are 3 of the best prospects in the game. So maybe the Phillies are asking way too much, but that is not what this is piece is about.

With my lack of connections, it is hard to me to get insight on where he will land. Not to mention that there are plenty of articles doing just that. Instead, I wanted to analyze the following question: If you trade for Cole Hamels, what exactly are you getting?

He is getting over $20M essentially each year, which, to those in the shadows, is a commonality nowadays. But how much value is that, considering that right now, the price of 1 WAR is roughly $8M. Using Steamer’s often conservative projection for Hamels’ 2015 season (2.6 fWAR) Hamels is worth approximately $21M by that measure, essentially par with what his contract stipulates.

Wait, a 2.6 fWAR projection seems low, right? Hamels has produced at least 3.5 fWAR every season since 2007, his sophomore campaign. Suppose we gave him that floor of 3.5 fWAR, as he is still only 31 years old. That would add up to roughly $28M of value – some $8M of surplus on his 2015 salary. We know eventually performance drops off with age, so it would be naïve of me to blindly assign 3.5 fWAR at each of the 4 guaranteed contract years. It looks like Steamer is hinting that the drop off should begin right away.

Baseball Reference also has this cool “comp” feature that analyzes similar players based on age and stats. Through age 30, the three most similar pitchers to Hamels are:

Jake Peavy

Doug Drabek

Kevin Appier

Peavy dealt with injury problems before he turned 30, and was not nearly as consistent – so that comp is not as helpful to us. Yet we do know how mediocre he has become. Kevin Appier and Doug Drabek, on the other hand, are both interesting comps. Through Drabek’s age 30 season, he had a 3.21 ERA in 1700 innings, compared to Hamels’ 3.27 ERA in 1800 innings. Appier is equally similar, as through his age 30 season, he had a 3.34 ERA in 1700 innings (innings rounded).

What happened next? Doug Drabek had a very strong age 31 season, but then never had an ERA below 4.50 again and retired at age 35. (For perspective, Hamels’ age 35 season will be in 2019). Kevin Appier regressed hard after 1998, his age 30 season, as well. Though he was not as bad as Drabek in their respective age seasons, he was roughly league average and bounced around 4 different teams.

I have used two good comps to visualize what Hamels’ outlook might be. I am aware it is not a large sample but perhaps it adds colour to the age 30 season being a turning point for pitchers of Hamels’ résumé. Returning back to Steamer’s low 2.6 fWAR projection, there may be probable cause, although, it may be too quickly regressing Hamels’ performance. Here is a simplification of a 4-year projection for Hamels, operating under slightly slower regression than Steamer:

2015

2016

2017

2018

Hamels’ WAR

3.5

3

2.5

2

Estimated Price of 1 WAR ($M)

8

8.5

9

9.5

Hamels’ Value ($M)

28

25.5

22.5

19

Hamels’ Salary ($M)

22.5

22.5

22.5

22.5

Surplus/Negative Value ($M)

5.5

3

0

-3.5

Evidently, with my assumptions and forecast, there is a small surplus in Hamels’ value. However, a lot of assumptions went into this, and while predicting 1 season ahead is hard, it is much harder to predict 4 seasons down the road.

In the end, the extra value of Hamels as a pitcher could theoretically come from the vesting option, which entails “400 innings pitched in 2017-2018; 200 innings pitched in 2018; he is not on the DL at end of 2018 with left shoulder or elbow injury”. Nowadays, pitchers are like babies – they can crash at any point. Throwing 200 innings in your mid-30s is no longer riding a bike, so I would expect the vesting option to not opt in, with Hamels being bought out – erasing any surplus value. Hamels isn’t “too much money”, though he is surely not “good value”. He is moderately priced, and if Ruben Amaro Jr. wants to keep his job, he should be treating him like an asset whose best years are in the past.

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